CA.

Naresh Aggarwal’s
ACADEMY of ACCOUNTS
Accounting • Costing • Taxation • Financial Management
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org

For Eenquiries
Call or whatsapp: 8800215448

AoA
Consignment Accounts (Whatsapp anytime, Calls only between 3.00 pm to 8.00 pm)

& Email: ca.naresh.vc@gmail.com

Website: academyofaccounts.org
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Y is entitled for 10% commission on sales and 2% del credere commission.

CA. Naresh Aggarwal’s Show Consignment Account and Y’s Personal Accounts in the books of X.
ACADEMY of ACCOUNTS [Profit: Rs.81,300; Commission: 43,200; Stock: Rs.97,500]

Accounting • Costing • Taxation • Financial Management Q-3: Sonu sent 1,000 bales of cloth costing Rs.250 each to Monu on consignment
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org basis. On sending the goods Sonu incurred the following expenses:
Freight - Rs.6,500
Insurance - Rs.1,500
Consignment Accounts Miscellaneous - Rs.4,000
Monu received the goods and incurred the following payments:
Goods Sent at Cost Octroi - Rs.2,000
Q-1: A of Amritser sends 2,000 units of an item costing Rs.100 each to B of Baroda Carriage - Rs.3,000
on consignment basis. On sending the goods A incurred the following expenses: Salaries - Rs.4,500
Packing Charges - Rs.5,000 Advertisements - Rs.2,500
Forwarding - Rs.3,000 After three months Monu sent an accounts sales informing 900 bales were sold at the
Freight - Rs.2,000 rate of Rs.350 per unit out of which 250 bales were on credit from which customers of
B receives the goods at Baroda and incurred the following payments: 20 bales proved bad.

AoA
Unloading - Rs.3,500 Monu was entitled for 10% commission on sales.
Freight - Rs.1,500 Show necessary accounts in the books of both parties.
Godown Rent - Rs.2,000 [Profit: Rs.29,200; Commission: 31,500; Stock: Rs.26,700; Consignee’s Bal.: Rs.2,64,500]
Selling Expenses - Rs.3,000
Establishments - Rs.1,000 p.m. Q-4: Sohan sent 2,000 bales of cloth costing Rs.300 each to Mohan on consignment
After three months B sends an accounts sales informing 1,200 units are sold at the basis. On sending the goods Sohan incurred the following expenses:
rate of Rs.180 per unit for cash and 300 units are sold at the rate of Rs.200 per unit on Insurance - Rs.7,500
credit from which customers of 5 units proved bad. Freight - Rs.4,500
B is entitled for 10% commission on sales and 2% del credere commission. Miscellaneous - Rs.1,000
Show Consignment Account and B’s Personal Accounts in the books of A. Mohan received the goods and incurred the following payments:
[Profit: Rs.73,630; Consignee Bal.: Rs.2,29,880; Commission: 33,120; Stock: Rs.53,750] Freight - Rs.4,000
Rent (Monthly) - Rs.1,500
Q-2: X of Delhi sent 1,000 Radio sets costing Rs.300 each to Y of Mumbai on Miscellaneous - Rs.2,500
consignment basis. On sending the goods X incurred the following expenses: After four months Mohan sent an accounts sales informing 1,500 bales were sold at
Freight - Rs.7,500 the rate of Rs.500 per unit out of which 200 bales were on credit from which customers
Insurance - Rs.2,500 of 12 bales proved bad.
Miscellaneous - Rs.5,000 Mohan was entitled for 5% commission on sales.
Y received the goods at Mumbai and incurred the following payments: Show necessary accounts in the books of both parties.
Octroi - Rs.7,000 [Profit: Rs.2,35,250; Commission: 37,500; Stock: Rs.1,54,250]
Cartage - Rs.3,000
Rent of Godown - Rs.3,500 Goods Sent at Invoice Price
Selling Expenses - Rs.1,500 Q-5: X of Agra sends 1,000 units of an item costing Rs.200 each to Y of Baroda to
Establishments - Rs.500 p.m. be sold at invoice price or above. The profit is decided to be 20% of sales. On
After six months Y sent an accounts sales informing 500 Radio sets were sold at the sending the goods X incurred the following expenses:
rate of Rs.500 per unit for cash and 200 Radio sets were sold at the rate of Rs.550 per Packing Charges - Rs.8,000
unit on credit from which customers of 10 units proved bad. Freight - Rs.2,000
Forwarding - Rs.3,000
 (3) (4)

Freight - Rs.2,500
CA. Naresh Aggarwal’s Insurance - Rs.1,100
ACADEMY of ACCOUNTS Miscellaneous - Rs.1,200
Manju received the goods and incurred the following payments:
Accounting • Costing • Taxation • Financial Management Octroi - Rs.1,300
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Carriage - Rs.1,100
Salaries - Rs.2,500
Y receives the goods at Baroda and incurred the following payments: Advertisements - Rs.4,500
Unloading - Rs.3,000 After three months Manju sent an accounts sales informing 900 bales were sold at the
Freight - Rs.2,000 rate of Rs.350 per unit out of which 250 bales were on credit from which customers of
Godown Rent - Rs.4,400 10 bales proved bad.
Selling Expenses - Rs.3,600 Manju is entitled for 5% commission on sales, 10% commission on above the invoice
Establishments - Rs.2,000 p.m. price.
After three months Y sends an accounts sales informing 700 units are sold at the rate Show necessary accounts in the books of both parties.
of Rs.300 per unit for cash and 100 units are sold at the rate of Rs.320 per unit on [Profit: Rs.62,850; Commission: 20,250; Stock: Rs.91,800; Consignee’s Bal.: Rs.2,81,850]
credit from which customers of 10 units proved bad.
Y is entitled for 5% commission on invoice price, 20% commission on any price realised Q-8: Sohan sent 2,500 bales of cloth costing Rs.250 each to Mohan on consignment

AoA
above invoice price and 2% del credere commission. basis. The invoice price is Cost + 20%. On sending the goods Sohan incurred the
Show Consignment Account and Y’s Personal Accounts in the books of X. following expenses:
[Profit: Rs.30,360; Commission: Rs.23,240; Stock: Rs.53,600; Consignee’s Bal.: Rs.1,99,760] Insurance - Rs.15,000
Freight - Rs.14,000
Q-6: A of Delhi sent 1,500 Radio sets at invoice price of Rs. 400 which is 1/3 of cost Miscellaneous - Rs.11,000
to B of Mumbai on consignment basis. On sending the goods A incurred the following Monu received the goods and incurred the following payments:
expenses: Freight - Rs.15,000
Freight - Rs.3,000 Rent (Monthly) - Rs.2,500
Insurance - Rs.1,500 Miscellaneous - Rs.2,500
Miscellaneous - Rs.1,500 After four months Mohan sent an accounts sales informing 2,000 bales were sold at
B received the goods at Mumbai and incurred the following payments: the rate of Rs.400 per unit out of which 200 bales were on credit from which customers
Octroi - Rs.1,000 of 12 bales proved bad.
Cartage - Rs.3,500 Mohan is entitled for 5% commission onsales, 10% commission on above the invoice
Rent of Godown - Rs.2,500 price.
Selling Expenses - Rs.1,500 Show necessary accounts in the books of both parties.
Establishments - Rs.500 p.m. [Profit: Rs.1,78,700; Commission: 60,000; Stock: Rs.1,61,000]
After six months B sent an accounts sales informing 1,100 Radio sets were sold at
the rate of Rs.450 per unit from which customers of 5 units proved bad. Q-9: Anil sends goods on consignment to Sunil. The terms are that Sunil will receive
B is entitled for 5% commission on invoice price, 15% commission on any price realised 10% commission on the invoice price (which is cost plus 25%) and 20% of any price
above invoice price and 2% del credere commission. realised above the invoice price. Sunil will meet his expenses himself , goods to be
Show Consignment Account and B’s Personal Accounts in the books of A. sent freight paid.
[Profit: Rs.1,10,150; Commission: 40,150; Stock: Rs.1,62,800] Anil sent goods costing Rs.3,20,000 and spent Rs.30,000 on freight, forwarding etc.
Sunil accepted a bill of exchange for Rs.3,00,000 immediately on receiving the
Q-7: Anju sent 1,200 bales of cloth to Manju on consignment basis at invoice price consignment. His expenses were Rs.4,000 as rent and Rs.2,000 as insurance. Sunil
which is Cost + 25%. The invoice price of each bale was Rs.300. On sending the sold three-fourth of the goods for Rs.3,90,000. Part of the sales were on credit and
goods Anju incurred the following expenses: one customer failed to pay Rs.8,000.
 (5) (6)

Commission: Rs.10,560; Consignee’s Balance: Rs.1,09,440]

CA. Naresh Aggarwal’s
ACADEMY of ACCOUNTS Q-13: On 01.01.2013 goods, cost price of which was Rs.66,000, were consigned by
Ram Dhan of Delhi to Agent Haldi Ram of Dadri at a proforma invoice price of 20%
Accounting • Costing • Taxation • Financial Management above cost. Haldi Ram paid freight and other forwarding charges amounting to Rs.2,000.
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org He was allowed Rs.1,000 per month towards establishment cost; 6% commission on
gross sales and 2% del credere commission. Haldi Ram paid Rs.500 as rent of godown
Give Consignment A/c and Sunil’s A/c in the books of Anil and Anil’s A/c in the books for three months ended 31.03.2013.
of Sunil. Three-fourth of the goods were sold for Rs.66,000, half of which were credit sales.
[Profit: 71,500; Balance with Sunil: 34,000; Commission: 48,000; Closing stock: 1,07,500] Half of the balance of goods was stolen, but the stock being insured, a claim lodged
for Rs.8,000 was settled for Rs.6,900.
Q-10: On 01.01.2013, A of Delhi consigned to B of Bombay goods for sale at Invoice Write up the Consignment Account, Consignee's Account and Stock Lost on
price. B is entitled to a commission of 3% on invoice price and 20% of any surplus Consignment Account as on 31.03.2013 in the books of Ram.
price realised. Goods costing Rs.60,000 were consigned to Bombay at the Invoice [B.Com(Pass) 1998 External] [Profit: Rs.6,220; Consignee’s Balance: Rs.55,220
price of Rs.72,000. The expenses of consignment amounted to Rs.5,000. On Abnormal Loss: Rs.8,500; Closing Stock: Rs.10,150; Commission: Rs.5,280]
31.03.2013 an Account Sales was received from B showing that he had effected sales
of Rs.60,000 in respect of 3/4th of the quantity of goods consigned to him. His Q-14: On 1st September goods costing Rs.5,28,000 were consigned by Amit of Agra

AoA
actual out of pocket expenses were Rs.3,000. B accepted a bill drawn by A for to his agent Sumit of Shrinagar, at proforma invoice price of 20% profit on cost price.
Rs.30,000 and remitted the balance due from him in cash. Show Ledger Accounts in Amit paid insurance and other forwarding charges on consignment amounting to
Give the Ledger Accounts in the books of the consignor and the consignee. Rs.20,000. Sumit was allowed Rs.4,000 being establishment cost. He was entitled to
[Profit: Rs.5,430; A receives from B: Rs.24,180; Commission: Rs.2,820; Closing stock: Rs.19,250] 5% commission on gross sales and an additional 3% del credere commission on
credit sales only. Sumit made an expense of Rs.4,080 as landing charges. Three-
Q-11: On 01.04.2013 Anju consigned 300 cases costing Rs.33,750 at a proforma fourth of the goods were sold at 33 1/3% profit on cost, half of which
invoice price of 25% profit on sale to her Agent Manju. On the same date, Anju paid for were credit sales. One-half of the balance of goods were destroyed by fire and a claim
loading and freight etc. amounting to Rs.2,700. Manju took delivery and paid Rs.5,400 lodged for Rs.56,000 was settled at a discount of 10%.
for octroi and other duties. Manju also remitted an advance of Rs.18,000 on receiving Show the Consignment A/c and the Stock Loss on Consignment A/c as on 31st
the consignment. She sold 240 cases for Rs.47,250. Manju is entitled to 5% commission December in the books of Amit and Sumit.
on gross sales and 10% on the sales price in excess of invoice price. Show Ledger [Adopted B.Com(P) Delhi] [Profit: Rs.75,620; Unsold stock: Rs.82,210;
Accounts in Give the Ledger Accounts in the books of the consignor and the consignee. Abnormal loss: Rs. 69,010; Total Sales: Rs.5,28,000; Commission: Rs.34,320]
[Profit: Rs.10,282, Commission - Rs.3,488; Closing stock: Rs.10,620; Manju’s Balance: Rs.20,362]
Q-15: X consigns to Y 200 cases of goods at a cost of Rs.1,000 per case. X incurs
Abnormal Loss the following expenses: Freight: Rs.4,500; Insurance: Rs.12,500. Y paid Cartage
Q-12: On 01.04.2013 goods cost price of which was Rs.1,32,000 were consigned by Rs.2,000 and Rent Rs.2,280. 20 cases were destroyed by fire and a sum of Rs.20,000
Meena to her agent Seema at a proforma invoice price of 20% above cost. Meena is recovered from the insurance company. Out of 180 cases, 130 cases of goods
paid freight and other forwarding charges amounting to Rs.4,000. Seema paid Rs.3,000 were sold for Rs.1,200 each. Commission payable to Y is 5% on sales. Y sent the
on unloading and she was allowed Rs.2,000 per month towards establishment cost; bank draft in full settlement of account. Show Ledger Accounts in Give the Ledger
5% commission on gross sales and 3% del credere commission. Seema paid Rs.1,000 Accounts in the books of the consignor and the consignee.
as rent of godown for four months ended 31.07.2013. [Profit: Rs.3,570; Abnormal loss: Rs.21,900; Unsold stock Rs.54,750,
Three-fourth of the goods were sold for Rs.1,32,000 half of which were credit sales. Commission: Rs.7,800; Received from Y: Rs.1,43,920]
Half of the balance of goods was stolen, but the stock being insured, a claim lodged
for Rs.14,000 was settled for Rs.13,000. Q-16: Dinesh of Delhi sent 500 machine parts to Suresh of Calcutta on Consignment
Write up the Consignment Account, Consignee's Account and Stock Lost on basis. The cost of each machine part was Rs.200, but it was invoiced at cost plus
Consignment Account as on 31.07.2013 in the books of Meena. 25%. The expenses of Dinesh were: Freight Rs.12,000; Insurance Rs.13,000.
[Profit: Rs.8,190; Closing Stock: Rs.20,675; Abnormal Loss: Rs.17,375; During the transit 50 parts were destroyed and the insurance company paid Rs.10,000
 (7) (8)

over invoice price. Vijay was to bear all expenses incurred after the goods reached
CA. Naresh Aggarwal’s his godown. While sending the goods Ajay paid Rs.3,000 as forwarding expenses
ACADEMY of ACCOUNTS and insurance. In transit 20 radio sets were damaged and Ajay recovered Rs. 8,000
from Insurance Company. Vijay took delivery of the remaining radio sets paying Rs.
Accounting • Costing • Taxation • Financial Management 9,000 as freight cartage etc. Vijay sold 140 radio sets at Rs. 800 each, 50 of them on
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org credit. Out of which the proceeds of 3 radio sets could not be recovered because of
disappearance of the customers. He also paid Rs.1,000 as storage and selling
towards that claim. Suresh sold 400 parts at Rs.300 each and paid for storage and expenses. Vijay sent a Bank Draft for balance amount due to Ajay.
insurance Rs.3,000 and Rs.2,000 respectively. Suresh also accepted a bill for Prepare necessary accounts in the books of both the parties.
Rs.80,000 at three months drawn by Dinesh. Dinesh discounted immediately with his [Profit: Rs.22,260; Abnormal Loss: Rs.10,300; Commission: Rs.10,640;
bank at 6% p.a. It was agreed that Suresh is to get 5% commission. Give the Ledger Consignee’s Balance: Rs.92,360; Stock: Rs.26,600]
Accounts in the books of the consignor and the consignee.
[Profit: Rs.9,000; Abnormal loss: Rs.12,500; Closing Stock: Rs.15,000; Goods Taken by Consignee
Commission: Rs.6,000; Suresh’s Balance: Rs.29,000] Q-20: Anita is the agent of Babita who despatched 200 Motors in January 2013,
drawing a Bill on Anita for Rs.40,000 for three months. A motor costs Rs.300, the
Q-17: 500 bicycles were consigned by Anita & Co. of Agra to Kavita & Co. of Kolkata invoice price decided to be is Rs.400. Anita is entitled to a commission of 15% of the
at an invoice cost of Rs. 1,000 each. Anita & Co. paid freight, Rs. 30,000 and insurance, invoice price plus 40% of the excess realised over Rs.400. She is also responsible for

AoA
Rs. 10,000. During the voyage 50 bicycles were totally damaged by fire, had to be all expenses incurred by her but not for freight and Octroi.
thrown overboard. Kavita & Co. took delivery of the remaining bicycles and paid Rs. Anita accepted the Bill. Expenses paid by Anita were: Freight Rs.4,000; Octroi Rs.2,000;
22,500 for custom duty. Storage Rs.1,000 and Insurance Rs.800.
Kavita & Co. sent a Bill of Exchange to Anita & Co. for Rs.3,50,000 payable after three At the end of March 2013, Anita reported that she has sold 150 Motors at an average
months which was discounted at 12% p.a. and latter sent an account sales showing price of Rs.440. It was agreed then that Anita would take over the remaining motors
that 350 bicycles were sold at Rs. 1,800 each. Expenses incurred by Kavita & Co. on on her own account at landed cost plus 20%.
godown rent and advertisement etc., amounted to Rs. 25,000. She is entitled to a Prepare: (a) Consignment A/c, (b) Anita’s Personal A/c, (c) Babita’s Personal A/c.
commission of 5%. [Profit: 8,400; Consignee’s Balance: 28,400; Commission: 11,400; Stock taken by Anita: 19,800]
Prepare the consignment account, Kavita & Co.’s A/c and Abnormal Loss A/c in the
books of Anita & Co., assuming that nothing has been recovered from the insurers Goods Returned to Consignor
due to defect in the policy. Q-21: ‘A’ sent goods to ‘B’ of Calcutta to be sold on behalf of ‘A’. ‘B’ getting a commission
[Profit: Rs.1,78,000; Closing Stock: Rs.113,000; Abnormal Loss: Rs.54,000; (including del credere commission) of 10% on sales effected by him. All expenses
Commission: Rs.31,500; Consignee’s Balance: Rs.2,01,000] were to be borne by ‘A’. The invoice value of goods was Rs.1,50,000 made up as cost
plus 20%. ‘A’ spent Rs.2,500 on forwarding and packing. ‘B’ paid the following:
Q-18: 1,000 cycles were consigned by X to Y at Rs.150 each. X paid freight Rs.10,000 Rs.
and insurance Rs.1,500. During transit 100 cycles were totally damaged by fire. Freight and cartage to godown 8,000
Insurance company paid Rs.14,000 for claim of loss. Y took delivery of 900 cycles Storage 1,500
and paid Rs.1,530 for octroi. 800 cycles were sold at Rs.220. Expenses of Y were Insurance 1,000
Rs.2,000. Y was entitled to a commission of 5%. Y settled the account by bank draft. Miscellaneous 500
Prepare ledger accounts in the books of X and Y At the end of three months ‘B’ reported that he had sold three-fifth of the goods for
[Profit: Rs.34,640; Abnormal loss: Rs.16,150; Rs.1,00,000. He returned 1/5 of the goods to ‘A’ as unsalable but he was confident of
Unsold stock: Rs.16,320;Received from Y: Rs.1,63,670] selling the remained goods. ‘B’ paid Rs.1,750 as freight on the returned goods. One
customer, who had bought on credit failed to pay Rs.4,000 due from him.
Q-19: Ajay of Agra consigned 200 radio sets costing Rs. 500 each to Vijay of Mumbai. Ascertain, by preparing relevant accounts, the profit or loss suffered by the two parties.
The invoice was made pro forma at Rs. 600 per set. Vijay was entitled to a commission [Adopted B.Com(P) Delhi] [Consignment Profit: Rs.1,850; Unsold stock: Rs.32,100;
of 5% on sales plus 2% del credere commission and 10% of any excess price realised Retuned Goods: 25,000; Consignee’s Commission: Rs.10,000; Net Profit of Consignee: Rs.6,000]
 (9) (10)

During the three months of the consignment ended 31.03.2013, Vijay incurred the
CA. Naresh Aggarwal’s following expenses:
ACADEMY of ACCOUNTS Selling Expenses
Rs.
600
Accounting • Costing • Taxation • Financial Management Godown Rent 500
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Carriage to Godown 1,000
On 01.02.2013, Vijay sold 1,200 kgs. of tea for cash at a profit of 25% on sales. On
Q-22: Meena & Co. of Calcutta who sent 400 sewing machines on consignment to 20.03.2013. Vijay returned 150 kgs. of tea which were poor quality to Sanjay and paid
Seema & Co. of Patna, spent Rs.1,000 on packing. The cost of each machine was return freight and carriage of Rs.250. Out of the remaining tea 200 kgs. destroyed by
Rs.112 but it was now invoiced at 25% above cost. fire. Vijay charged his commission @ 5% and settled the accounts on 31.03.2013.
Two boxes containing 10 machines in each box was lost in transit. Seema & Co. was Sanjay closes his books every year on 31 st March every year.
asked to pay Rs.1,900 as freight of the remaining machines. Seema & Co. had to Show the necessary accounts in the books of the consignor and consignee.
spend Rs.380 as cartage and octroi duty and Rs.760 as godown rent. Seema & Co. [Profit: Rs.15,150; Vijay’s Balance: Rs.88,850; Goods Returned: Rs.9,000;
sold 300 machines @ Rs.190. and found 40 machines defective and therefore returned Abnormal Loss: Rs.12,400; Commission: Rs.4,800; Closing stock: Rs.27,900]
them to Calcutta at a cost of Rs.200, Seema & Co. is entitled to a commission of 5%
on invoice price, 20% of any excess realized on the invoice price and 1% del credere Opening Stock in Consignment
commission. Seema & Co. could not realize sale proceeds of 20 machines. Q-25: Bombay Consignment Account in the books of Arti of Agra showed a debit

AoA
Show Ledger Accounts in Give the Ledger Accounts in the books of the consignor balance of Rs.15,000 representing the cost of 10 bicycles on 01.01.2013. On
and the consignee. 01.03.2013 Arti sent a further consignment to Bombay of 40 bicycles costing Rs.1,600
[Profit: Rs.13,880, Abnormal loss: Rs.2,290; Unsold Stock Rs.5,940; each. The freight and other charges amounted to Rs.2,400. On 15.12.2013 the Bombay
Commission: Rs.5,670; Value of Goods Returned: Rs.4,480] Agent sent an Account Sales showing that 8 bicycles from the old stock realised
Rs.1,400 each and 25 bicycles from the second consignment realised Rs.2,000 each
Q-23: Ajay of Amritsar sent a consignment of cotton goods to Vijay of Varodara, and 15 bicycles remained in stock unsold. Two bicycles from the old stock being
invoiced at Rs.2,00,000. The invoice price was made by adding 25% to the cost. The unsalable at Bombay were returned to Agra, for which the Bombay Agent sent a
expenses incurred by Ajay were: Packing Rs.4,800; Carriage Rs.3,200; Insurance separate debit note for Rs.300 being expenses incurred by him.
Rs.2,400 and other expenses Rs.5,200. After three months he received Account Sales The Bombay Agent is entitled to a selling commission of 5 per cent which covers all
intimating that half of the consignment was sold at Rs.1,20,000. The expenses incurred out of pocket expenses in respect of the consignment.
by the consignee were: Freight Rs.6,000; Fire Insurance Rs.3,600 and other expenses Show the necessary accounts in the books of the consignor and consignee. Supposing
Rs.2,000. His commission was 5% on sales and del credere commission 2 1/2%. But that she closes her accounts on 31st December each year.
no sale could be made of the remainder so that it was brought back after another nine [Profit: Rs.4,340; Bombay Agent’s Balance: 57,840;
months at a further cost of Rs.12,000 paid by Vijay. The goods were damaged and Returned Goods: Rs.3,000; Commission: 3,060; Closing stock: 24,900]
valued at 20% below cost. Give necessary ledger accounts in the books of both the
parties. Normal Loss
[Adopted B.Com(P) Delhi] Q-26: Mahesh consigned 400 tins of vegetable oil (one tin contains 10 Kgs of oil) to
[Loss: Rs.24,200; Goods Returned: Rs.64,000; Commission: Rs.9,000; Amount due to Vijay: Dinesh costing Rs.50 per Kg. The consignors paid Rs.16,000 for forwarding charges
87,400] and Rs.24,000 for freight. 10 tins of oil were totally damaged during transit.
Dinesh took delivery of the oil and sent an Account Sales showing that 300 tins were
Q-24: On 01.01.2013, Sanjay consigned 2,000 kgs. of tea costing Rs.60 per kg. to sold for Rs.2,40,000. The expenses incurred by them were custom duty and clearing
Vijay. Sanjay incurred the following expenses on sending the goods : charges Rs.14,320 and selling expenses Rs.4,000. They are entitled to a commission
Rs. of 5% on sales. Dinesh also reported that 20 Kgs. of oil were lost due to leakage which
Freight Expenses 2,000 was considered to be normal. Show the necessary ledger accounts in the books of
Insurance 400 Mahesh and Dinesh.
Sundry Expenses 600 [Profit: Rs.32,000; Dinesh’s Balance: Rs.2,09,680;
Abnormal Loss: Rs.6,000; Commission: Rs.12,000; Closing stock: Rs.56,320]
 (11) (12)

CA. Naresh Aggarwal’s

ACADEMY of ACCOUNTS Mohan reported that 60 tons were sold @ Rs.2,500 per ton. His expenses being:
Freight: Rs.3,000; Godown Rent: Rs.5,000 and on Staff Salaries Rs.6,000. Mohan is
Accounting • Costing • Taxation • Financial Management entitled to a commission of 4%. Half of the closing stock was stolen from godown.
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Mohan paid the amount due by Bank Draft.
Show the accounts in the books of The Coal Company and Mohan.
[Profit: Rs.22,600; Bank Draft received from Dinesh: Rs.50,000;
Q-27: The Chemicals Company, consigned 1,000 Ltrs. of chemicals to its agent
Abnormal Loss: Rs.13,800; Commission: Rs.6,000; Closing stock: Rs.13,800]
Dinesh of Delhi on 01.04.2013. The cost of the chemicals was Rs.200 per Ltr. The
Chemicals Company paid Rs.50,000 as freight and insurance. During transit, 25 Ltrs.
were accidently destroyed for which the insurer paid directly to the consignors Rs.4,500
in full settlement of the claim.
Dinesh took delivery of the remaining consignment on the 10th April and immediately
•••••••••••••••••••••••••
accepted a Bill drawn on him by The Chemicals Company for Rs.1,00,000 for three
months. On 30th June Dinesh reported that 750 Ltrs. were sold @ Rs.300. His expenses
being: Godown rent Rs.2,000; Advertisement Rs.10,000 and on Staff Salaries

AoA
Rs.20,000. Dinesh is entitled to a commission of 3% plus 11/2% Del Crederes. Dinesh
reported a loss of 10 Ltrs. due to leakage, assumed to be normal. Dinesh paid the
amount due by Bank Draft.
Show the accounts in the books of The Chemicals Company and Dinesh which close
the books on 30 th June.
[Loss: Rs.6,568; Bank Draft received from Dinesh: Rs.82,875;
Abnormal Loss: Rs.6,250; Commission: Rs.10,125; Closing stock: Rs.54,307]

Q-28: Rajesh consigned 210 Boxes of Apples (one Box contains 10 Kgs of Apples)
to Suresh costing Rs.10 per Kg. The consignors paid Rs.600 for forwarding charges
and Rs.2,400 for freight. 100 Kgs. were damaged in transit due to moisture and
considered normal. But further 20 Boxes were totally damaged during transit due to an
accident.
Suresh took delivery of the remaining goods and sent a Bank Draft of Rs.20,000 an
Account Sales showing that 150 boxes were sold for Rs.25 per Kg. The expenses
incurred by them were Duty and Freight Rs.2,700; Storage Expenses Rs.1,500 and
Selling Expenses Rs.2,500. They are entitled to a commission of 20% on sales. Show
the necessary ledger accounts in the books of Rajesh and Suresh.
[Profit: Rs.5,750; Suresh’s Balance: Rs.3,300;
Abnormal Loss: Rs.2,400; Commission: Rs.7,500; Closing stock: Rs.4,050]

Q-29: Coal Company, consigned 80 tons of Coal to its agent Mohan. The cost of the
Coal was Rs.1,500 per ton. Coal Company paid Rs.15,000 as freight to railway. During
20 days of transit a weight loss of 5 ton were reported which were considered normal.
Mohan took delivery of the remaining consignment and immediately accepted a Bill
drawn on him by Coal Company for Rs.80,000 for three months. After three months
 (13) (14)

profit made by the branch.

CA. Naresh Aggarwal’s Rs.
ACADEMY of ACCOUNTS Stock with Branch on 1.1.2013
Branch Debtors on 1.1.2013
30,000
15,000
Accounting • Costing • Taxation • Financial Management Petty cash balance on 1.1.2013 ?
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Goods received from Head Office 2,00,000
Goods returned to Head Office 40,000
Shortage of stock at Branch 4,000
Branch Accounts Credit Sales 1,25,000
Bad Debts 2,500
Q-1: Delhi Head Office supplied goods to its branch at Agra at invoice price which is
Sales Return 4,000
cost plus 50%. All cash received by the branch is remitted to Delhi and branch ex-
Cash received from Debtors 1,10,000
penses are paid by the Head Office. From the following particulars relating to Agra
Discount allowed to Debtors 4,500
branch for the year 2013, prepare Branch Stock Account, Branch Debtors Account
Petty Expenses 2,600
and Petty Cash Account in the books of the Head Office so as to find out the and net
Cash sent by Head Office
profit made by the branch.
Rent 6,000
Rs.
Office Expenses 24,000

AoA
Stock with Branch on 1.1.2013 ?
Petty Cash 2,000 32,000
Branch Debtors on 1.1.2013 22,000
Cash Sales 45,000
Petty cash balance on 1.1.2013 200
Stock with Branch on 31.12.2013 ?
Goods received from Head Office 3,72,000
Branch Debtors on 31.12.2013 ?
Goods returned to Head Office 36,000
Petty cash balance on 31.12.2013 900
Credit Sales 1,72,000
[Loss: 1,100; Closing Stock: 20,000; Closing Debtors: 19,000; Opening Petty Cash: 1,500]
Shortage of stock at Branch 3,000
Cash received from Debtors 1,80,000
Q-3: XYZ Ltd. had its Head Office at Delhi and a Branch at Pune. The Head Office
Discount allowed to Debtors 4,800
invoices the goods to the Branch including a profit of 20% of Invoice Price.
Bad Debts 2,000
The following are the transactions of the Head Office with the Branch for the
Sales Return 6,000
year ended 31.12.2013 :
Petty Expenses 1,600
Rs.
Cash sent by Head Office
Stock at Branch as on 1.1.2013 (at Invoice Price) 46,200
Rent 4,800
Debtors at Branch as on 1.1.2013 24,750
Salaries 48,000
Petty cash as on 1.1.2013 750
Petty Cash 2,000 54,800
Furniture on 1.1.2013 20,000
Cash Sales 2,24,000
Goods supplied to the Branch (at Invoice Price) 2,26,800
Stock with Branch on 31.12.2013 60,000
Remittance from the Branch
Branch Debtors on 31.12.2013 ?
Cash Sales 15,750
Petty cash balance on 31.12.2013 ?
Collections from Debtors 2,36,610 2,52,360
[Profit: 66,800; Opening Stock: 1,17,000; Closing Debtors: 1,200; Closing Petty Cash: 600]
Amount sent to Branch
Salary 11,160
Q-2: Anita Traders supplied goods to its branch at Kanpur at invoice price which is 1/
Advertisements 3,600
3 above cost. All cash received by the branch is remitted to Delhi and branch ex-
Petty Cash 4,500 19,260
penses are paid by the Head Office. From the following particulars relating to Kanpur
Stock at Branch as on 31.12.2013 (at Invoice Price) 34,725
branch for the year 2013, prepare Branch Stock Account, Branch Debtors Account
Sundry Debtors at the Branch as on 31.12.2013 75,690
and Petty Cash Account in the books of the Head Office so as to find out the and net
Petty cash as on 31.12.2013 1,125
 (15) (16)

Goods returned to head office 2,000

CA. Naresh Aggarwal’s Cash received for expenses 14,500
ACADEMY of ACCOUNTS Stock at the end
Debtors at the end
15,000
22,500
Accounting • Costing • Taxation • Financial Management [B.Com(P) 1987] [Profit: Rs.13,100; Credit Sales: Rs.40,000]
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org
Q-6: A Company of Bangalore, has a Branch at Jaipur to which goods are invoiced at
cost plus 30%. The following are the transactions between the Head Office and the
Depreciate Furniture by 15%.
Branch for the year ending 31.12.2013.
From the above show the Branch Account in the books of the Head Office.
Rs.
[Profit: Rs.90,795; Credit Sales Rs.2,87,550; Surplus in Stock: Rs.65,025; Petty Expenses: Rs.4,125]
Stock at the Branch on 01.01.2013 13,000
Sundry Debtors on 01.01.2013 25,000
Q-4: A Ltd. had its Head Office at Bombay and a Branch at Delhi. The Head Office
Petty Cash on 01.01.2013 1,250
invoices the goods to the Branch including a profit of 25% above the cost.
Goods sent to Branch 65,000
The following are the transactions of the Head Office with the Branch for the year
Total sales effected during the year 1,10,000
ended 31.12.2013 :
Cash sales 85,000
Rs.
Cash received from Branch Debtors 42,000
Stock at Branch as on 01.01.2013 (at Invoice Price) 15,400

AoA
Expenses incurred by the Branch for the year (Other then Petty Exp.) 11,500
Debtors at Branch as on 01.01.2013 8,250
Branch stock on 31.12.2013 52,000
Petty cash as on 01.01.2013 250
Petty Cash on 31.12.2013 650
Goods supplied to the Branch 75,600
Show how the Branch Account will appear in the books of the Head Office.
Amount sent to Branch :
[Profit: Rs.77,900; Closing Debtors: Rs.8,000; Surplus in Stock: Rs.84,000; Petty Expenses: Rs.600]
Salary 3,720
Rent 1,200
Q-7: A Head Office in Bombay has a branch in Ahmedabad to which goods are
Petty Cash 1,500 6,420
invoiced by the Head Office at cost price plus 25%. All cash received by the branch is
Remittance from the Branch :
daily remitted to the head office. All expenses are paid from Bombay. From the following
Cash Sales 5,250
particulars show how the branch account will appear in head office books (entries to
Realisation of debts 78,870 84,120
be made at invoice price):
Sundry Debtors as on 31.12.2013 25,230
Rs.
Petty cash as on 31.12.2013 375
Stock on 01.07.2012 (at invoice price) 12,500
Stock at Branch as on 31.12.2013 11,575
Debtors on 01.07.2012 12,000
From the above show the Branch A/c in the Head Office books.
Goods invoiced from Bombay 40,000
[B.Com(P) 1998 Regular]
Remittances to Bombay:
[Profit: Rs.31,265; Credit Sales Rs.95,850; Petty Expenses: Rs.1,375; Surplus in Stock: Rs.21,675]
Cash sales 16,000
Cash received from debtors 29,000 45,000
Q-5: A head office in Bombay has a branch in Delhi to which goods are invoiced by
Goods returned to Head Office 2,400
the head office at cost price plus 25%. Prepare Branch Account in the books of head
Cheques received from Bombay:
office from the following particulars :
Wages and Salaries 11,000
Rs.
Rent, rates, etc. 3,000
Stock in the beginning 12,500
Sundry expenses 510 14,510
Debtors in the beginning 12,000
Stock on 30.06.2013 (invoice price) 15,000
Goods received from Bombay 40,000
Debtors on 30.06.2013 22,500
Cash Sales 16,000
[Profit: Rs.12,910; Credit Sales: Rs.39,500; Surplus in Stock: Rs.20,400]
Cash received from Debtors 29,500
 (17) (18)

Cash sales for the year 35,000

CA. Naresh Aggarwal’s Bad debts 2,000
ACADEMY of ACCOUNTS Cash remitted by Head Office to Branch during the year
Expenses incurred at Branch
9,000
7,000
Accounting • Costing • Taxation • Financial Management Stock at Branch on 31.03.2013 at invoice price ?
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Debtors as on 31.03.2013 5,000
Cash in hand at Branch on 31.03.2013 ?
Furniture as on 31.03.2013 (after charging 20% Depreciation for full year) 4,000
Q-8: Delhi Office has an old established branch at Kanpur. Goods are invoiced to the Show the Branch Account in the Head Office books to determine Profit/Loss of the
branch at 20% profit on sales; the branch having been instructed to send all cash daily Branch for the year ended on 31st March, 2013. Give your workings clearly.
to the Head Office. All expenses are paid by the Head Office except petty expenses [Profit: Rs.7,400; Stock in transit: 15,000; Closing Stock in Hand: 8,000
which are met by the Branch Manager. From the following particulars you are required Opening Furniture: Rs.5,000; Collection from Debtors: 63,000; Closing Cash: 4,000]
to draw up Branch Accounts as it would appear in the books of, the Head Office :
Rs. Q-10: Print Textiles Company has a branch at Delhi. Goods are invoiced from Head
Stock on 01.01.2013 (invoice price) 45,000 Office at cost plus 331/3%. Find out profit at the branch according to Debtors System.
Sundry Debtors on 01.01.2013 27,000 Rs.
Cash in Hand on 01.01.2013 1,200 Opening Balances :

AoA
Goods Supplied by the Head Office 2,40,000 Debtors 10,000
Goods Returned to Head Office 3,000 Petty cash 1,000
Goods Returned by Debtors 1,440 Furniture 2,000
Cash Received from Debtors 90,000 Stock (invoice price) 8,000 21,000
Cash Sales 1,50,000 Goods invoiced by Head Office during the year 88,000
Credit Sales 90,000 Cash sent by Head Office for petty expenses 2,000
Discount allowed 900 Branch expenses and losses :
Expenses paid by Head Office : Freight and Advertisement 5,600
Rent 3,600 Bad Debts 50
Salary 7,200 Depreciation on Furniture 80
Stationery and Printing 900 11,700 Petty Expenses 1,500 7,230
Petty Expenses paid by Branch Manager 840 Sales :
Furniture as on 31.12.2013 (after charging 10% Depreciation for full year) 3,240 Cash 50,000
Stock on 31.12.2013 (Invoice price) 42,000 Credit 36,000 86,000
[Profit: Rs.32,760; Closing Debtors: Rs.24,660; Shortage: Rs.1,440; Opening Furniture: Rs.3,600] Goods returned by Debtors 800
Goods returned by Branch to Head Office 2,000
Q-9: India Ltd. Delhi had a branch at Mumbai on 1st April, 2012 to which goods were Cash received from Debtors 20,000
sent 25% above cost. All the money collected at branch are remitted to Head Office. Stock at the end at invoice price 7,800
The following further details are given for the year ended 31st March, 2013 [B.Com(P) 1991]
Rs. [Profit: Rs.13,320; Closing Debtors: Rs.25,150; Closing Petty Cash: Rs.1,500; Shortage: Rs.1,000]
Stock at Branch on 01.04.2012 at invoice price 10,000
Debtors as on 01.04.2012 18,000 Q-11: The Bombay Stores invoices goods to their various branches at cost, and the
Cash in hand at Branch on 01.04.2012 2,000 branches sell the goods not only for cash but on credit also. Expense of branches are
Cost of goods sent to Branch during 2012-2013 80,000 paid by the Head office. From the following particulars relating to Madras Branch,
Goods received by Branch till 31st March, 2013 at invoice price 85,000 prepare Branch Account in the books of Head Office.
Credit sales for the year 52,000
 (19) (20)

Cheques received from the Head Office

CA. Naresh Aggarwal’s Wages and Salaries 55,000
ACADEMY of ACCOUNTS Rent, Rates and Taxes
Sundry Expenses
15,000
2,550 72,550
Accounting • Costing • Taxation • Financial Management Stock on January 31.12.2013 (invoice price) 75,000
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Debtors on 31.12.2013 1,12,500
Liability for Petty Expenses 550
Rs. [Profit: Rs.66,500; Credit sales: Rs.2,00,000; Surplus in Stock: Rs.1,04,500]
Opening Balances at Branch as on 01.04.2012 :
Stock 8,000 Q-13: Bombay Shoes, has a branch at Panipat. Goods are invoiced to the branch at
Debtors 4,000 selling prices being cost plus 25%. The branch keeps its own Sales Ledger and
Petty Cash 500 deposits all cash received daily to the credit of the Head Office Account opened at the
Furniture 6,000 18,500 State Bank of India, Panipat. All expenses are paid by cheque from Bombay. From the
Goods Sent to branch during the year 22,000 following details, prepare a Branch Account in the Head Office Books and make the
Goods returned by the Branch 800 necessary Adjustments therein to arrive at the actual branch profit and loss during the
Cheques sent to Branch during the year 2012-2013 : year 2012-2013.
For Salaries 2,000

AoA
For Rent 1,000 Stock on 01.04.2012 75,000 Rent, Rates and Taxes 24,000
For Petty Cash 300 3,300 Stock on 31.03.2013 90,000 Sundry Expenses 4,800
Cash remitted by Branch during the year 2012-2013 : Sundry Debtors on 01.04.2012 42,000 Cash Sales for the year 3,24,000
Cash Sales 10,000 Sundry Debtors on 31.03.2013 54,000 Credit Sales 2,10,000
Cash from Debtors 9,000 19,000 Goods Invoiced from H.O. 5,46,000 Cash Received from Debtors 1,98,000
Credit Sales during the year 25,000 Salaries Paid 20,400 Salaries Still Owing 2,000
Goods returned by Debtors during the year 400
Discount allowed to Debtors 500 [B.Com(P) 1993 External] [Profit: 58,000; Surplus in Stock: Rs.3,000]
Bad Debts 100
Closing Balances at Branch as on 31.03.2013 : Q-14: Diamond Ltd., Mumbai started a branch in Delhi on 01.04.2012 to which goods
Stock 10,000 were sent 120% of cost. Branch expenses are met from branch cash, balance money
Petty Cash 200 10,200 remitted to Head Office. The following further details are given for the year ended
Write off depreciation on Furniture 10% p.a. 31.03.2013 :
[Profit: Rs.10,600; Closing Debtors: Rs.19,000; Closing Furniture: Rs.5,400]
Cost of goods sent to branch 1,00,000 Cash remitted to Head Office 86,000
Q-12: Goa Head Office has a branch in Delhi to which goods are invoiced by the Goods received by branch Cash in hand at branch
Head Office at 20% profit on sale price. All cash received by the branch is daily remitted till 31.03.2013 at I.P. 1,08,000 as on 31.03.2013 4,000
to Head Office. From the following particulars, show how the Branch Account will Credit sales for the year 1,16,000 Cash remitted by Head Office
appear in the Head Office books. Also prepare other necessary A/cs. Debtors as on 31.03.2013 41,600 to branch during the year 6,000
Rs. Bad debts 400 Closing stock at branch
Stock on January 01.01.2013 (at invoice price) 62,500 Expenses incurred at branch 24,000 at invoice price 12,000
Debtors on 01.01.2013 60,000
Goods supplied by the Head Office 2,00,000 Show the Branch Account in the Head Office books to determine profit or loss for the
Cash sales 80,000 branch for the year ended on 31.03.2013. Give your workings clearly.
Cash received from customers 1,47,500 [Adopted B.Com(P) Delhi]
Goods returned to the Head Office 12,000 [Profit: Rs.45,600; Cash received from Debtors: Rs.74,000;
Cash Sales: Rs.34,000; Stock in Transit: Rs.12,000; Surplus in Stock: Rs.54,000]
 (21) (22)

Total Sales 2,10,000

CA. Naresh Aggarwal’s Cash received from debtors 48,000
ACADEMY of ACCOUNTS Goods returned by the Branch to Head Office
Goods returned by the debtors to Branch
1,500
600
Accounting • Costing • Taxation • Financial Management Cash sent to the branch for
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Rent 3,600
Petty Cash 600
Insurance (upto June 2013) 400
Q-15: XYZ Ltd. opened a new Branch at Baroda on 01.01.2013 where goods are sent Salaries 10,200 14,800
by H.O. at 25% above cost. All expenses of Branch are met from Branch cash and Petty cash expenses incurred by the Branch 500
the balance remitted to H.O. Branch sells goods both for cash and credit. From the Stock on 31-3-2013 3,000
following particulars, prepare the necessary accounts in the books of H.O. and ascertain Salaries due on 31-3-2013 Nil
the profits or loss made by branch for the ended 31.12.2013 assuming that the Stock Depreciate Furniture by 20%.
and Debtors System : [Profit: 92,650; Closing Debtors: 2,400; Closing Petty Cash: 700; Surplus in Stock: Rs.83,900]
Rs.
Cost of goods sent to Branch 1,00,000
Goods received by Branch till 31.12.2013 (Invoice Price) 90,000 Q-17: Best Company of Punjab have a branch at Jammu. All purchases are made by

AoA
Normal loss during transit (at invoice price) 5,000 the Head Office and goods sent to branch are invoiced at selling price which is 20%
Debtors on 31.12.2013 10,000 above cost. All sales by the branch are on credit terms. Branch expenses are paid by
Cash at Branch on 31.12.2013 4,000 the Head Office and all cash received by the Branch is remitted to the Head Office. All
Cash remitted to H.O. 90,000 branch transactions are recorded in the Head Office books. From the following
H.O. remitted cash to Branch 5,000 particulars prepare stated accounts to reveal the profit earned at the branches:
Cash sent by H.O. 10,000 Rs.
Credit Sales 95,000 Branch Stock as on 01.04.2012 72,000
Bad Debts and Allowances to customers 1,000 Branch Debtors as on 01.04.2012 51,500
Closing Stock at Invoice Price 20,000 Transactions during the year to 2012-2013 were:
[Surplus in Stock: Rs.25,000; Stock in transit: Rs.30,000; Branch Expenses: Rs.5,000; Goods sent to branch at Invoice Price 6,49,200
Collection from Debtors: Rs.84,000; Gross profit: Rs.35,000; Net profit: Rs.29,000] Returns from branch to Head Office 12,840
Cash received from Debtors 6,20,000
Q-16: From the details given below relating to Patna branch for the year ending Discount allowed to Debtors 11,500
March 31, 2013 prepare Patna Branch account and Branch Debtors account in the Branch expenses paid by Head Office 60,000
books of Head Office. Show your working clearly. Goods are invoiced to give a profit Branch Stock as on 31.03.2013 96,360
of 20% of selling price. Branch Debtors as on 31.03.2013 20,000
Stock on 1-4-2012 15,000 Prepare following accounts in the books of the Head Office :
Debtors on 1-4-2012 6,000 (a) Branch Stock A/c (b) Branch Debtors A/c
Furniture on 1-4-2012 3,000 (c) Branch Expenses A/c (d) Branch Adjustment A/c
Petty Cash on 1-4-2012 600 [Adopted B.Com(P) Delhi]
Insurance prepaid on 1-4-2012 150 [Shortage in Stock: Rs.12,000; Credit Sales: Rs.6,00,000; Net Profit: Rs.18,500]
Salaries due on 1-4-2012 3,000
Goods sent to Branch 1,20,000 Q-18: Delhi head office supplies goods to its branch at Jammu at invoice price which
Normal Loss of goods 2,000 is cost plus 50%. All cash received by the branch is remitted to Delhi and all branch
Abnormal Loss of goods 3,000 expenses are paid by the Head Office. From the following particulars related to Jammu
Cash Sales 1,65,000 Branch for the year 2013 prepare Branch Debtors A/c, Branch Stock
 (23) (24)

Q-20: Kolkata Head office opened a branch on 01.04.2012. Goods are invoiced at
CA. Naresh Aggarwal’s
selling price which was fixed by adding 25% to the cost. From the following particulars
ACADEMY of ACCOUNTS relating to the year 2012-2013, ascertain the profit or loss made at the branch under
the Stock and Debtors System :
Accounting • Costing • Taxation • Financial Management Rs.
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Goods sent to Branch (Invoice Price) 2,10,000
Cash Sales 75,000
Credit Sales 1,05,000
A/c and Branch Adjustment A/c in the books of the Head Office so as to find out the Cash received from Debtors 93,600
Gross Profit and Net Profit made by the branch : Discount allowed to Customers 2,400
Goods returned by Customers 3,000
Stock at I.P. on 01.01.2013 99,000 Cash received from debtors 1,39,500 Cash remitted to Branch for :
Branch Debtors on 01.01.2013 33,000 Discount allowed to debtors 3,600 Rent 1,800
Petty Cash on 01.01.2013 750 Expenses (Cash sent by H.O.) Salaries 9,000
Goods received from head office 3,06,000 Rent 3,600 Sundry Expenses 1,200 12,000
Goods returned to Head Office 9,000 Salaries 36,000 Defective cloth found in the bales written off 300
Credit Sales 1,30,500 Petty Cash 3,000 42,600 [Closing stock: Rs.32,700; Closing Debtors: Rs.6,000; Gross profit Rs.35,400; Net profit Rs.20,760]

AoA
Cash Sales 1,59,000 Sales Returns 4,500
Allowance to Customer on Selling Stock at I.P. on 31.12.2013 1,03,500 Q-21: On 01.01.2013, goods costing Rs.1,32,000 were invoiced by Punjab Head
Price (adjusted while invoicing) 3,000 Petty Cash on 31.12.2013 150 Office to its branch at Patna and charged up at a selling price designed to produce a
gross profit of 25% on the selling price. At the end of the first quarter, the returns from
[Adopted B.Com(P) Delhi] Patna branch showed that the sales were Rs.1,20,000. Goods invoiced at Rs.2,400
[Closing Debtors: 15,900, Shortage in Stock: 4,500; Gross profit: Rs.93, 000; Net profit: Rs.43,200] to the branch had been returned to Head Office. The closing stock at the branch was
Rs.49,200 at selling price. Record the above transactions in Patna Branch Stock
Q-19: Agra head office supplied goods to its branch at Delhi at invoice price which is Account, Patna Branch Stock Adjustment Account in the Head Office Ledger and
cost plus 50%. All cash received by the branch is remitted to Agra and all branch balance the said accounts on 31.03.2013.
expenses are paid by the Head Office. Following are particulars relating to Delhi Branch [Gross profit: Rs.30,000; Net profit: Rs.26,700; Shortage of stock: Rs.4,400]
for the year 2013 :
Q-22: Crown Industries, Bombay has a branch at Madurai to which goods are invoiced
Stock with Branch on 01.01.2013 60,000 Discount allowed to Debtors 2,400 at cost + 25%. The branch makes sales both for cash and on credit. Branch expenses
Branch Debtors on 01.01.2013 12,000 Expenses (cash sent to Branch) are paid direct from Head Office and the branch remits all cash to Head Office. From
Petty Cash on 01.01.2013 100 Rent 2,400 the following details, prepare necessary ledger accounts in Head Office books to
Goods received from Head Office 1,86,000 Salaries 24,000 calculate branch profits as per the Stock and Debtors System.
Goods returned to Head Office 18,000 Petty Cash 1,000 Rs.
Credit Sales less Returns 86,000 Branch Stock on 31.12.2013 54,000 Goods Received from Head Office at invoice price 60,000
Cash Sales 1,04,000 Petty Cash on 31.12.2013 100 Returns to Head Office at invoice price 1,200
Cash received from Debtors 90,000 Branch Debtors on 31.12.2013 ? Branch Stock on 01.01.2013 at invoice price 6,000
Cash Sales 20,000
Prepare: Branch Stock A/c, Branch Debtors A/c, Branch Expenses A/c and Branch Credit Sales 36,000
Adjustment A/c in the books of the Head Office so as to find out the Gross Profit and Branch Debtors on 01.01.2013 7,200
Net Profit made by the branch. Cash collected from debtors 32,000
[Surplus in Branch Stock: Rs.16,000; Closing Debtors: Rs.5,600; Discount allowed to debtors 600
Gross Profit: Rs.74,000; Net profit: Rs.44,200] Bad Debts in the year 400
Goods returned by debtors to branch 800
 (25) (26)

CA. Naresh Aggarwal’s Q-25: M/s Star Traders, Delhi, have opened a branch at Panipat on 1.7.2012. The
ACADEMY of ACCOUNTS goods were sent by the Head Office to the branch and invoiced at selling price of the
branch which was 125% of the cost price of the head office. The following are the
Accounting • Costing • Taxation • Financial Management particulars relating to the transactions of branch :
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org Rs.
Goods sent to branch (at cost to Head Office) 2,80,800
Sales at Branch:
Rent, Rates and Taxes at branch 1,800
Cash 1,25,000
Branch office expenses 800
Credit 1,75,000 3,00,000
Branch Stock at invoice price on 31.12.2013 12,000
Cash collected from Debtors 1,56,000
[B.Com(P) 1992] [Surplus in Stock: Rs.2,400; Closing Debtors: Rs.9,400;
Discount allowed 4,000
Gross profit: Rs.11,040 or Rs.12960; Net profit: Rs.9,360]
Cash sent to branch for :
Wages 3,000
Q-23: Golden Ltd. sent goods to its Rajasthan Branch at cost plus 25%. From the
Freight 7,000
following particulars prepare Branch Stock A/c, Branch Adjustment A/c and Branch
Insurance 4,000
Profit and Loss A/c :
Other expenses including godown rent 6,000 20,000
Rs.

AoA
Spoiled cloth in bales written off at invoice price 500
Opening stock at branch (invoice price) 10,000
Insurance claim received for spoiled cloth 350
Goods sent to branch 40,000
Stock on 30.06.2013 at Invoice Price 55,500
Loss-in-transit at invoice price 5,000
Ascertain the gross profit and net profit for the Branch for the year ended 30.06.2013
Theft at invoice price 2,000
after preparing Branch Stock Account and Branch Debtors Account.
Loss in weight (normal) at invoice price 1,000
[Surplus in Stock: Rs.5,000; Closing Debtors: Rs.15,000; Gross profit: Rs.64,000; Net profit: 39,950]
Sales 51,000
Expenses 16,000
Q-26: Lacknow Head Office supplied goods to its branch at Jaipur at invoice price
Closing stock at branch at cost 12,000
which is 150% of cost. All cash received by the branch is remitted to Head Office and
Claim received from for loss in transit by Head office 4,000
branch expenses are paid by the Head Office. From the following particulars relating
[Gross proflt: Rs.28,600; Net profit: Rs.11,000; Surplus in Stock: Rs.24,000]
to Jaipur branch for the year 2013, prepare Branch Stock Account, Branch Debtors
Account, Goods sent to Branch Account in the books of the Head Office so as to find
Q-24: The Bombay Head Office sent goods to Madras Branch at 25% profit over
out the and net profit made by the branch.
costs. From the following details, prepare the Branch Account in the Head Office
Rs.
books and ascertain the net profit at the Branch :
Stock with Branch on 1.1.2013 18,600
Rs.
Branch Debtors on 1.1.2013 13,600
Opening stock of goods at Branch at invoice price 20,000
Petty cash balance on 1.1.2013 1,200
Goods sent to Branch at invoice price 90,000
Cost of Goods sent to Branch 68,000
Loss of goods in transit at invoice price 6,000
Sales at the Branch
Pilferage of goods at branch at its cost considered normal 1,200
Cash 50,020
Closing stock at Branch at its cost 16,000
Credit 62,000 1,12,020
Sales at Branch 1,05,000
Cash collected from Debtors 60,800
Salaries and wages at Branch 6,000
Goods returned by branch to Head Office 2,400
Other expenses at Branch 3,000
Goods transferred by Jaipur Branch to Alwar Branch 1,500
Madras Branch received Rs.4,000 from the Insurance Company in settlement of the
Goods transferred by Delhi Branch to Jaipur Branch 4,500
claim for the loss of goods in transit.
Shortage of Stock at Head Office 4,200
[Profit: Rs.24,800; Surplus in Stock: 18,200]
Shortage of Stock at Branch 900
 (27) (28)

CA. Naresh Aggarwal’s Independent Branch

ACADEMY of ACCOUNTS Q-28: Super Ltd. with its Head Office in Calcutta has a branch at Delhi . You are
Accounting • Costing • Taxation • Financial Management given the Following particulars relating to Delhi Branch for the year ended
30.06.2018:
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org
Particulars Rs.
Stock at Branch on 01.07.2017 .... .... .... 15,700
Discount allowed to customers 150 Goods sent to branch during the year .... .... .... 45,000
Bad Debts 250 Total sales at Branch (including Rs.19,700 for cash sales) .... .... .... 73,300
Cash Sent to Branch for : Cash received from debtors .... .... .... 52,200
Salaries 6,000 Branch Debtors on 01.07.2017 .... .... .... 16,900
Office Expenses 4,000 Petty Cash at Branch on 01.07.2017 .... .... .... 110
Petty Cash 1,500 11,500 Goods returned by the Branch .... .... .... 3,900
Petty Expenses at Branch 2,000 Cash Sent to Branch for expenses:
[Profit: 24,340; Closing Stock: 8,280; Closing Debtors: 14,400; Closing Petty Cash: 700] Salary .... .... .... 12,800
Petty Cash .... .... .... 2,600

AoA
Q-27: Delhi Ltd. has two branches at Mumbai and at Goa. Goods are invoiced to Rent .... .... .... 3,000
branches at cost plus 50%. From the following particulars prepare the necessary Stock at Branch on 30.06.2018 .... .... .... 18,800
accounts on Stock and Debtors system to reveal the profit earned at the branches: Petty Cash at Branch on 30.06.2018 .... .... .... 90
Prepare a Branch Trading and Profit and Loss Account and Delhi Branch Account
Mumbai Goa in the Books of Head Office.
Rs. Rs. [Gross Profit: Rs.34,700; Profit: Rs.16,280]
Stock at invoice price on 01.01.2013 37,200 62,400
Debtors on 01.01.2013 27,200 34,800 Q-29: Apex manufactures a range of goods which it sells to wholesale customers
Goods invoiced to Branches at Cost 1,36,000 1,44,000 only from its head office. In addition, the H.O. transfers goods to a branch at factory
Cash sales 1,00,040 1,40,000 cost plus 15%. The branch then sells these goods to the general public on only cash
Credit sales 1,24,000 1,20,400 basis.
Goods returned by Branch to Head Office 6,000 - The selling price to wholesale customers is designed to give a factory profit which
Goods transferred from Goa to Mumbai 8,400 8,400 amounts to 30% of the sales value. The selling price to the general public is designed
Cash collected from Debtors 1,21,600 1,19,200 to give a gross margin of 30% of the sales value.
Goods returned by Debtors 4,800 6,000 It operates from rented premises and leases all other types of fixed assets. The rent
Surplus in stock - 1,200 and hire charges for these are included in the overhead costs shown in the trial
Shortage in stock 1,800 - balances.
Discount allowed to customers 800 1,400 From the information given below, you are required to prepare for the year ended
Expenses at Branches 21,600 26,800 31.03.2018 in columnar form.
(a) A Profit & Loss account for (i) H.O. (ii) the branch (iii) the entire business.
[Adopted B.Com(P) Delhi] [Closing Stocks: Mumbai Rs.22,560 and Goa Rs.16,800; (b) Balance Sheet as on 31.03.2018 for the entire business.
Closing Debtors: Mumbai Rs.24,000 and Goa Rs.28,600; Gross Profits: Mumbai Rs.73,080 and
Goa Rs.84,800 or Rs.85,600; Net Profits: Mumbai Rs.49,480 and Goa Rs.57,400]
 (29) (30)

Trial Balance as on 31.03.2018 Balance Sheet as on 31.03.2018

CA. Naresh Aggarwal’s
Head Office Branch Liabilities Rs. Assets Rs.
ACADEMY ofDebit
Particulars ACCOUNTS
Credit Debit Credit Creditors 1,00,000 Debtors 5,00,000
RawAccounting • Costing • Taxation
materials purchased • Financial Management
52,500 Head Office 4,20,000 Building Extension —
Direct wages 1,62,750 (Transfer to H.O. A/c)
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org
Factory overheads 58,500 Cash at Bank 20,000
Stock on 01.04.2017 5,20,000 5,20,000
Raw materials 2,700
Finished goods 19,500 13,800 During the six months ending on 30.9.2018, the following transactions took place
Debtors 55,500 at Delhi :
Cash 33,000 1,500 Particulars Rs. Particulars Rs.
Administrative Salaries 20,850 6,000 Sales 6,00,000 Manager’s Salary 12,000
Salesmen Salaries 33,750 9,300 Purchases 1,20,000 Collections from Debtors 4,00,000
Selling overheads 18,750 3,450 Wages paid 50,000 Discounts allowed 20,000
Inter-unit accounts 7,500 3,000 Salaries (Prepaid Rs.5,000) 16,000 Discount earned 3,000
Capital 75,000 General Expenses 4,000 Cash paid to Creditors 1,50,000

AoA
Sundry Creditors 19,500 Building A/c (further payment) 10,000 Cash at Bank 70,000
Provision for unrealized profit 1,800 Insurance premium paid (annual) 8,000 Cash in Hand 4,000
Sales 3,00,000 97,800 Remittance to H.O. 96,000
Goods sent to Branch 69,000 Set out the Head Office Account in Delhi books and the Branch Balance Sheet as on
Goods received from H.O. 66,750 30.09.2018.
4,65,300 4,65,300 1,00,800 1,00,800 [Gross Profit: Rs.4,30,000; Net Profit: Rs.3,82,000; Creditor’s Balance: Rs.67,000
Notes:
Debtor’s Balance:Rs.6,80,000; Head Office A/c: Rs.69,600; Balance Sheet: Rs.7,63,000
(a) On 29.03.2018 the branch remitted Rs.2,250 to the H.O. and this has not yet
been recorded in the H.O. books. Also on the same date, the H.O. dispatched Q-31: The following Trial balances as at 31.03.2018 have been extracted from the
goods to the branch invoiced at Rs.2,250 and these too have not yet been entered books of Micro Ltd. and its branch at a stage where the only adjustments
into the branch books. It is the company’s policy to adjust items in transit in the requiring to be made prior to the preparation of a Balance Sheet for the undertaking
books of the recipient. as a whole.
(b) The stock of raw materials held at the H.O. on 31.03.2018 was valued at Rs.3,450. Trial Balance as on 31.03.2018
(c) You are also advised the followings : Head Office Branch
(i) There were no stock losses incurred at the H.O. or at the branch.
Particulars Debit Credit Debit Credit
(ii) Firm has practice to value finished goods stock at the H.O. at factory cost.
(iii) There were no opening or closing stock of work-in-progress. Share Capital 7,50,000
(d) Branch employees are entitled to a bonus of Rs.1,500 under a bilateral agreement. Fixed Assets 3,75,000 1,20,000
[Branch - Gross Profit: Rs.29,340; Net Profit: Rs.9,090; Balance Sheet: Rs.15,840 Current Assets 6,10,000 95,000
Head Office - Gross Profit: Rs.99,000; Net Profit: Rs.25,580; Balance Sheet: Rs.1,21,950 Current Liabilities 1,75,000 42,000
Stock Reserve (01.04.2017) 3,500
Closing Stock Reserve: Rs.1,870]
Revenue Account 2,06,500 63,000
Branch Account 1,50,000
Q-30: National Company of Kolkata has a branch at Delhi to which the goods are
Head Office Account 1,10,000
supplied from Kolkata but the cost thereof is not recorded in the Head Office books.
On 31.03.2018 the Branch Balance Sheet was as follows : 11,35,000 11,35,000 2,15,000 2,15,000
 (31) (32)

4. Goods sent by Delhi Branch to Bombay Branch Rs.1000 are yet to be

CA. Naresh Aggarwal’s recorded.
ACADEMY of ACCOUNTS 5.
6.
Delhi Branch collected Rs.500 from a customer of Head Office.
Bombay Branch paid Rs.3,000 for a machine purchased by Head Office for
Accounting • Costing • Taxation • Financial Management the use in Head Office itself.
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org 7. Head Office expensesare to be allocated to Delhi and Bombay Branches are
Rs.3,000 and Rs.2,000 respectively .
You are required to record the following in the appropriate ledger accounts in both 8. Provide depreciation at 10% on furniture when the furniture accounts are
sets of books: maintained by Head Office. Value of Furniture is as under :
1. Goods transferred from Head Office to the Branch are invoiced at cost plus - Furniture at Delhi Branch : Rs. 25,000
10% and both Revenue Accounts have been prepared on the basis of the prices - Furniture at Bombay Branch : Rs.15,000
charged. 9. For the current year Delhi Branch showed a net loss of Rs.2,500 and Bombay
2. Stock reserve is relating to the Head Office goods held by the Branch on Branch a net Profit of Rs.10,000.
01.04.2017.
3. Current assets of branch Includes goods received from Head Office at invoice
price Rs.26,500.
4. Goods invoiced by Head Office to Branch at Rs.13,750 were in transit at

AoA
31.03.2018, as was also a remittance of Rs.17,500 from the Branch. Foreign Branch
5. At 31st March, 2018, the following transactions were reflected in the Head Office
books but unrecorded in the Branch books: Q-34: On 31st December, 2018 the following balances appeared in the books of
(a) The purchase price of lorry, Rs.12,500, which reached the Branch on Delhi Branch of an English firm having its Head Office in New York:
December 25th. Delhi Branch Trial Balance as on 31.12.2018
(b) a sum received on March 30, 2018 from one of the Branch debtors, Rs.3,750.
Particulars Debit (Rs.) Credit (Rs.)
[Branch A/c: Rs.1,32,500 (Debit); Head Office A/c: Rs.1,32,500 (Credit)
Closing Balance of Stock Reserve: Rs.3660 Stock on 01.04.2018 1,40,400 -
Purchases and Sales 9,37,500 14,06,250
Branch Balance Sheet: Rs.2,37,500; H.O. Balance Sheet: Rs.11,31,340]
Debtors and Creditors 4,59,000 3,06,000
Bills Receivable and Payable 1,22,400 1,07,100
Q-32: Journalise the Following transactions in the books of Branch and Head
Salaries and Wages 60,000 -
Office:
Rent, Rates and Taxes 63,750 -
(i) Goods worth Rs.5,000 are supplied by Delhi Branch to Agra Branch under the
Furniture 54,600 -
instruction from Head Office.
Bank A/c 3,41,190 -
(ii) Delhi Branch draws a bills receivable for Rs.5,000 on Agra branch which sends
New York Account - 3,59,490
its acceptence .
(iii) Head Office charges Rs. 4,000 from Delhi Branch as Head Office administative 21,78,840 21,78,840
expenses. Stock on 31st December, 2018 was Rs.3,82,500. Branch account in New York books
showed a debit balance of $8,040 on 31.12.2018 and Furniture appeared in the Head
Q-33: Give journal entries for the follwing trasactions in the books of Head Office. Office books at $1,050.
Head Office accounts are closed every year on 31st December : The rate of exchange for 1 $ on 31.12.2017 was Rs.52 and on 31.03.2018 was
1. Cash remitted by Delhi Branch Rs.300 not received by Head Office till 31st Rs.51. The average rate for the year was Rs.50.
December. Prepare in the Head Office books the Profit and Loss a/c and the Balance Sheet of
2. Goods sent by Head Office on 28 December amounting to Rs.500 to its the Branch assuming integral foreign operation.
Bombay Branch not received by the Branch till 31st December . [Exchange Loss: $1,200; Gross Profit: $14,175; Net Profit: $10,500
3. Expenses paid by Head Office on 28 December for its Delhi Branch Rs.1,000 Total of Balance Sheet: $26,640]
and for Bombay Branch Rs.1,100 not yet adjusted in the accounts.
 (33) (34)

Net Profit: Rs.18,000 (H.O.) & Rs.90,600 (Branch)

CA. Naresh Aggarwal’s Balance Sheet: Rs.1,78,000 (H.O.) & Rs.1,32,600 (Branch)]
ACADEMY of ACCOUNTS Q-36: M/s Sun Ltd. has head office at New York and branch at Mumbai. Mumbai
Accounting • Costing • Taxation • Financial Management branch is a non integral foreign operation of M/s Sun Ltd. Mumbai branch furnishes
West Patel Nagar, New Delhi. Ph:8800215448. Website: www.academyofaccounts.org you with its trial balance as on 31st March, 2018 and the additional information given
there after:
Mumbai Branch Trial Balance as on 31.03.2018
Q-35: Bombay Ltd. have a branch in Sydney, Australia. Sydney branch is an integral
Particulars Debit (Rs.) Credit (Rs.)
foreign operation of Bombay Ltd. At the end of 31st March, 2018, the following ledger
balances have been extracted from the books of the Bombay Office and the Sydney Stock on 1st April, 2017 1,50,000 –
Office: Purchases and sales 4,10,000 6,15,000
Sundry Debtors and creditors 2,01,600 1,47,000
Trial Balance as on 31.03.2018
Bills of exchange 63,000 1,17,600
Head Office (Rs.) Branch Wages 2,78,800 –
(Dollars) Rent and Rates 1,80,400 –
Particulars Debit Credit Debit Credit Sundry charges 82,000 –

AoA
Share Capital – 1,00,000 – – Computers 1,26,000 –
Reserves & Surplus – 50,000 – – Bank balance 2,10,000 –
Land and Building 65,000 – – – New York office A/c – 8,22,200
Plant & Machinery (Cost) 1,25,000 – 10,000 – 17,01,800 17,01,800
Prov. for Dep. on Plant & Machinery – 30,000 – 6,500
Additional information:
Debtors / Creditors 14,000 10,000 3,000 1,500
(a) Computers were acquired from a remittance of US $ 2,950 received from New
Stock (1.4.2017) 5,000 – 1,000 –
York head office and paid to the suppliers. Depreciate computers at 30% for the
Cash & Bank Balances 500 – 500 –
year.
Purchases / Sales 12,000 26,000 1,000 6,150
(b) Unsold stock of Mumbai branch was worth Rs.2,10,000 on 31.03.2018.
Goods sent to Branch – 5,000 250 –
(c) The rates of exchange may be taken as follows:
Managing Director’s salary 1,500 – – –
On 1.4.2018 @ Rs.40 per USD
Wages & Salaries 3,750 – 2,250 –
On 31.3.2018 @ Rs.42 per USD
Rent – – 600 –
Average exchange rate for the year @ Rs.41 per USD
Office Expenses 1,250 – 900 –
You are asked to prepare in US dollars the revenue statement for the year ended
Commission Receipts – 13,000 – 5,000
31st March, 2018 and the balance sheet as on that date of Mumbai branch as would
Branch / H.O. Current A/c 6,000 – – 350
appear in the books of New York head office of M/s Sun Ltd. You are informed that
2,44,000 2,44,000 19,500 19,500 Mumbai branch account showed a debit balance of USD 19,150 on 31.3.2018 in
The following information is also available: New York books and there were no items pending reconciliation.
(1) Stock as at 31.3.2018: Bombay Rs.10,000; Sydney $ 150 [Currency Translation Reserve: $800; Gross Loss: $550; Net Loss: $7,850
(2) You are required to convert the Sydney Branch Trial Balance into rupees by Total of Balance Sheet: $18,400]
using the following rates of exchange and prepare Trading A/c, Profit & Loss
A/c and Balance Sheet of Branch and Head office :
Opening rate 1$ = Rs.20 Average rate 1$ = Rs.22
Closing rate 1$ = Rs.24 For Fixed Assets 1$ = Rs.18 ••••••••••••••••••••••
(3) Charge depreciation on Plant and Machinery @10% under Straight Line Method.
[Exchange Loss: Rs.10,800; Gross Profit: Rs.20,250 (H.O.) & Rs.42,400 (Branch)
 (35) (36)

9. For any kind of Abnormal Loss

Consignment Accounts
CA. Naresh Aggarwal’s
(i) Abnormal Loss A/c (Cost of Ab. Loss) Dr. No Entry
ACADEMY ofEntries
Journal ACCOUNTS To Consignment A/c

Accounting • Costing • Taxation • Financial Management (ii) Insurance Co. / Bank A/c Dr. No Entry
To Consignment A/c (If claim admitted)
InPatel
West the books of Consigner
Nagar, New Delhi. Ph:8800215448. Website: In the books of Consignee
www.academyofaccounts.org
10a. If Consignment A/c shows Profit
1a. When goods sent on consignment basis at Cost Consignment A/c (Profit Amount) Dr. No Entry
Consignment A/c (Cost of goods sent) Dr. No Entry To Profit and Loss A/c
To Goods Sent on Consignment A/c
10b. If Consignment A/c shows Loss
1b. When goods sent on consignment basis at Invoice Price Profit and Loss A/c A/c (Loss Amount) Dr. No Entry
(i) Consignment A/c (I.P. of goods sent) Dr. No Entry To Consignment A/c
To Goods Sent on Consignment A/c
(ii) Goods Sent on Consignment A/c Dr. No Entry Format of Accounts in the Books of Consignor
To Consignment A/c (Loading)
Consignment Account
2. When Expenses are paid by Consignor
Particulars Rs. Particulars Rs.

AoA
Consignment A/c (Any Expnese) Dr. No Entry
To Bank / Cash A/c To Consignment Stock A/c 1
xxx By Stock Reserve A/c 1
xxx
3. When Expenses are paid by Consignee (Opening stock, if any) (Loading of Opening Stock, if any)
Consignment A/c (Any Expenses) Dr. Consignor’s A/c Dr. To Goods sent on Consignment A/c2 xxx By Goods sent on Consignment 2xxx
To Consignee’s A/c To Cash / Bank A/c (Cost or Invoice Price) (Loading of Goods sent, if any)
To Bank A/c (Expenses of Consignor) By Goods sent to Branch (Return)3 xxx
4a. When goods returned by consignee at Cost
Packing xx By Consignee’s A/c (Sales) xxx
Goods Sent on Consignment A/c Dr. No Entry
Freight / Carriage / Cartage xx Cash Sales xx
To Consignment A/c (Cost of Return)
Duties and Taxes xx Credit Sales xx
4b. When goods returned by consignee at Invoice Price Loading Charges xx Stock Taken (If any) xx xxx
(i) Goods Sent on Consignment A/c Dr. No Entry Transit Insurance xx By Abnormal Loss (Cost of Loss) xxx
To Consignment A/c (I.P. of Return) Other Expenses xx xxx By Consignment Stock A/c 4 xxx
To Consignee’s A/c (His Expenses) (Closing stock, if any)
(ii) Consignment A/c (Loading of Return) Dr. No Entry Unloading Charges# xx By Profit and Loss A/c (Loss) xxx
To Goods Sent on Consignment A/c Freight / Carriage / Cartage# xx
5. When goods sold by Consignee (Cash sales and credit sales) Duties and Taxes# xx
Godown Rent xx
Consignee’s A/c Dr. Cash / Bank/ Consignor’s Debtors A/c Dr.
Staff Salary xx
To Consignment A/c To Consignor’s A/c
Advertisement xx
6. When commission allowed to Consignee (Cash sales and credit sales) Insurance Charges xx
Consignment A/c Dr. Consignor’s A/c Dr. Return Freight xx
To Consignee’s A/c To Commission A/c Bad Debts* xx
Other Expenses xx
7. When any remittance received from Consignee (after sales or in Advance) Commission xx xxx
Cash / Bank / Bills Receivables A/c Dr. Consignor’s A/c Dr. To Goods sent to Branch A/c 3 xxx
To Consignee’s A/c To Cash / Bank / Bills Payables A/c (Loading of Goods returned, if any)
To Stock Reserve A/c 4 xxx
8. For any kind of Normal Loss
(Loading of Closing Stock, if any)
No Entry No Entry
To Profit and Loss A/c (Profit)
xxxx xxxx
 (37) (38)

Consignee’s Personal Account Format of Accounts in the Books of Consignee

CA. Naresh Aggarwal’s
Particulars Rs. Particulars Rs. Consignor’s Personal Account
ACADEMY ofByACCOUNTS
To Balance b/d (Op. Balance, if any) Consignment A/c xxx Particulars Rs. Particulars Rs.
To Accounting
Consignment A/c • Costing • Taxationxxx • Financial
Unloading Charges#Managementxx
To Cash / Bank A/c By Cash / Bank A/c (Cash Sales) xxx
CashPatel
West SalesNagar, New Delhi. Ph:8800215448.
xx / Carriage / Cartage#
Freightwww.academyofaccounts.org
Website: xx
Unloading Charges# xx By Consignor’s Debtors A/c xxx
Credit Sales xx Duties and Taxes# xx
Freight / Carriage / Cartage# xx (Credit Sales)
Stock Taken (If any) xx xxx Godown Rent xx
Duties and Taxes# xx By Purchase A/c (Stock taken) xxx
Staff Salary xx
Godown Rent xx By Cash / Bank A/c xxx
Advertisement xx
Staff Salary xx (Any Money received from /
Insurance Charges xx
Advertisement xx on behalf of Consignor)
Return Freight xx
Insurance Charges xx
Bad Debts* xx
Return Freight xx
Other Expenses xx
Other Expenses xx xxx
Commission xx xxx
To Consignor’s Debtors A/c xxx
By Cash / Bank / Bills Receivablexxx
(For Bad Debts*)
By Balance c/d (Closing Balance)
To Commission A/c xxx

AoA
xxxx xxxx To Cash / Bank / Bills Payable xxx
To Balance c/d (Closing Balance)
Goods Sent on Consignment Account
xxxx xxxx
Particulars Rs. Particulars Rs.
To Consignment A/c2 xxx By Consignment A/c2 xxx
---------------------------------------------------------------------
(Loading of goods sent, if any) (Value of Goods Sent)
To Consignment A/c3 xxx By Consignment A/c3 xxx
(Value of goods returned) (Loading of goods returned, if any) Branch Accounts
To Trading / Purchase A/c
(Net cost of goods sent) Debtors System (Journal Entries)
xxxx xxxx
1a. When goods sent to branch at cost :

Abnormal Loss Account

Branch A/c (Cost of goods sent) Dr.
To Goods Sent to Branch A/c
Particulars Rs. Particulars Rs.
1b. When goods sent to branch at invoice price :
To Consignment A/c xxx By Insurance Co. / Bank xxx
(i) Branch A/c (Invoice value of goods sent) Dr.
(Cost of abnormal loss) (Claim admitted, if any)
To Goods Sent to Branch A/c
By Profit and Loss A/c xxx
(Balancing figure) (ii) Goods Sent to Branch A/c (Loading amount of goods sent)
To Branch A/c
xxxx xxxx
2. When cash sent to branch (Any reason) :
Branch A/c Dr.
To Bank A/c
 (39) (40)

3a. When goods returned by branch at cost : Branch Stock Account

CA. Naresh Aggarwal’s
Goods Sent to Branch A/c (Cost of goods returned) Dr. Particulars Rs. Particulars Rs.
ACADEMY
To Branch A/c of ACCOUNTS To Balance b/d (Opening Balance) xxx By Cash (Cash Sales) xxx
3b.Accounting • Costing
When goods returned • Taxation
by branch • Financial
at invoice price : Management To Goods sent to Branch A/c xxx By Branch Debtors (Credit Sales) xxx
(i)West
Goods Sent
Patel to Branch
Nagar, A/c (Invoice
New Delhi. value of goods
Ph:8800215448. returned)
Website: www.academyofaccounts.orgDr. To Branch Debtors A/c (Sales Returns) xxx By Goods sent to Branch A/c (Return) xxx
To Branch A/c To Surplus (Branch Adj.-I) xxx By Normal Loss (Branch Adj.-I) xxx
By Abmormal Loss (Branch Adj.-I&II) xxx
(ii) Branch A/c (Loading amount of goods returned) Dr.
By Shortage / Deficits (Branch Adj.-I&II) xxx
To Goods Sent to Branch A/c
By Allowances (Trade Discount) xxx
4. When cash remitted by branch (Any reason) : By Balance c/d (Closing Balance)
Bank A/c Dr. xxxx xxxx
To Branch A/c
Branch Debtors Account

Format of Accounts in Debtors System Particulars Rs. Particulars Rs.

To Balance b/d (Opening Balance) xxx By Cash A/c (Collection from Debtors) xxx

AoA
Branch Account
To Branch Stock A/c (Credit Sales) xxx By Discount A/c (Cash Discount) xxx
Particulars Rs. Particulars Rs. By Bad Debts xxx
To Balance b/d (Opening Balance) xxx By Balance b/d (Opening Balance) xxx By Branch Stock A/c (Sales Return) xxx
Stock1 xx Stock Reserve (Loading)1 xx By Balance c/d (Closing Balance)
Debtors xx Outstanding Expenses xx xxxx xxx
Petty Cash xx Other Liabilities, if any xx xxx
Furniture xx By Goods sent to Branch (Loading)2 xxx Branch PETTY CASH Account
Prepaid Expenses xx By Bank A/c (Remittance) xxx
Other Assets xx xxx Cash Sales xx Particulars Rs. Particulars Rs.
To Goods sent to Branch 2 xxx Collection from Debtors xx To Balance b/d (Opening Balance) xxx By Petty Expenses (Exp. Incurred) xxx
To Bank A/c (Cash Sent) Other Collections xx To Bank A/c (Cash sent for petty Exp.) xxx By Balance c/d (Closing Balance) xxx
Salary xx less: Deductions, if any (xx) xxx
Rent xx By Goods sent to Branch (Return)3xxx xxxx xxx
Petty Cash xx By Profit and Loss A/c (Loss) xxx
Sundry Expenses xx By Balance c/d (Closing Balance) Branch TOTAL CASH Account
Others Payments xx xxx Stock4 xx Particulars Rs. Particulars Rs.
To Goods sent to Branch (Loading)3 xxx Debtors xx
To Profit and Loss A/c (Profit) Petty Cash xx To Balance b/d (Opening Balance) xxx By Branch Expenses (Cash Expense) xxx
To Balance c/d (Closing Balance) Furniture xx To H.O. Bank A/c (Cash sent to Branch) xxx By H.O. Bank A/c (Cash Remitted to H.O.) xxx
Stock Reserve (Loading)4 xx Prepaid Expenses xx To Branch Stock (Cash Sales) xxx By Balance c/d (Closing Balance) xxx
Outstanding Expenses xx Other Assets xx xxx To Branch Debtors (Collections) xxx
Other Liabilities, if any xx xxx To Other Receipts (If any) xxx

xxxx xxxx xxxx xxx

Format of Accounts in Stock and Debtors System

 (41) (42)

Branch Adjustment (I&II) Account 3. When goods returned by Branch

CA. Naresh Aggarwal’s Goods Sent / Returened by Branch A/cDr. Head Office A/c Dr.
Particulars Rs. Particulars Rs.
ACADEMY of ACCOUNTS
To Goods Sent to Branch xxx By Stock Reserve A/c xxx
To Branch A/c
4. When Cash remitted by Branch
To Branch Stock A/c

Accounting Costing
(Loading of Goods•Returned • Taxation(Loading
to H.O.) • Financial
of Opening Management
Stock) Bank / Cash A/c Dr. Head Office Dr.
To West
Branch
PatelStock
Nagar,A/c xxx ToWebsite:
New Delhi. Ph:8800215448. Goodswww.academyofaccounts.org
Sent to Branch xxx To Branch A/c To Bank / Cash A/c
(Total of Normal Loss) (Loading of Goods sent to branch)
5. Any payment made by Head office on behalf of Branch
To Branch Stock A/c xxx By Branch Stock A/c xxx Branch A/c Dr. Cause of Payment (Name) A/c Dr.
(Loading of Ab. Loss / Shortage) (Total of Surplus) To Bank / Cash A/c To Head Office A/c
To Stock Reserve A/c xxx By Gross Loss (c/d) xxx
(Loading of Closing Stock) 6. Any collection received by Head office on behalf of Branch
Bank / Cash A/c Dr. Head Office A/c Dr.
To Direct Expenses (If any) xxx
To Branch A/c To Cause of Collection (Name) A/c
To Gross Profit (c/d) xxx
7. Any payment made by Branch on behalf of Head Office
xxxx xxxx Cause of Payment (Name) A/c Dr. Head Office A/c Dr.
To Gross Loss (b/d) xxx By Gross Profit (b/d) xxx To Branch A/c To Bank / Cash A/c
To Branch Expenses xxx By Insurance Claim xxx 8. Any collection received by Branch on behalf of Head Office

AoA
To Petty Expenses xxx By Other Incomes xxx Branch A/c Dr. Bank / Cash A/c Dr.
To Depreciation xxx By Profit & Loss A/c (Net Loss) xxx To Cause of Collection (Name) A/c To Head Office A/c
To Bad Debts xxx
To Discount Allowed xxx Journal Entries for Cash / Goods in Transit (In the books of H.O.)
To Branch Stock A/c xxx
(Cost of Ab. Loss / Shortage) 1. When goods remain in transit (any reason)
To Other Expenses xxx
Goods in Transit A/c Dr.
To Branch A/c
To Profit & Loss A/c (Net Profit) xxx
1a. When ‘Goods in transit’ reached to Branch (Case: Goods sent to Branch)
xxxx xxxx Branch A/c Dr.
To Goods in Transit A/c

--------------------------------------------------------------------- 1b. When ‘Goods in transit’ reached to Head Office (Case: Goods Returned by Branch)
Goods Sent / Returened by Branch A/c Dr.
Independent Branch (For Hons. Students only) To Goods in Transit A/c
Journal Entries for Goods and Cash Sent to Branch / Head Office 2. When Cash remain in transit (any reason)
Cash in Transit A/c Dr.
To Branch A/c
In the books of Head Office In the books of Branch
2a. When ‘Cash in transit’ reached to Branch (Case: Cash sent to Branch)
1. When goods sent to Branch Branch A/c Dr.
Branch A/c Dr. Branch Stock A/c Dr. To Cash in Transit A/c
To Goods Sent to Branch A/c To Head Office A/c
2b. When ‘Cash in transit’ reached to Head Office (Case: Cash remitted by Branch)
2. When Cash sent to Branch Cash A/c Dr.
Branch A/c Dr. Bank / Cash A/c Dr. To Cash in Transit A/c
To Bank / Cash A/c To Head Office A/c
 (43)

Journal Entries for Head Office Expenses charged to Branch

CA. Naresh Aggarwal’s
ACADEMY
In the books of Head Office of ACCOUNTS
In the books of Branch
1a.Accounting
When expeses•areCosting
composite• and later charged
Taxation to Branch
• Financial Management
Branch A/c Dr. Head Office Expenses A/c Dr.
WestTo
Patel Nagar,Name
Expense New Delhi.
/ ProfitPh:8800215448.
& Loss A/c Website:
To Headwww.academyofaccounts.org
Office A/c
1b. When expeses are exclusive and immediately charged to Branch
Branch A/c Dr. Expenses Name A/c Dr.
To Cash / Bank A/c To Head Office A/c

Accounting for Fixed Assets

CASE-1: Fixed Assets Accounts are with Branch

In the books of Head Office In the books of Branch

AoA
1a. When Assets are purchased and paid by Head Office
Branch A/c Dr. Assets A/c Dr.
To Cash / Bank A/c To Head Office A/c
1b. When Assets are purchased and paid by Branch
No Assets A/c Dr.
Entry To Cash / Bank A/c
2. When Depreciation is charged on Assets
No Depreciation A/c Dr.
Entry To Assets A/c

CASE-2: Fixed Assets Accounts are with Head Office

In the books of Head Office In the books of Branch

1a. When Assets are purchased and paid by Head Office

Branch Assets A/c Dr. No
To Cash / Bank A/c Entry
1b. When Assets are purchased and paid by Branch
Branch Assets A/c Dr. Head Office A/c
To Branch A/c To Cash / Bank A/c
2. When Depreciation is charged on Assets
Branch A/c Dr. Depreciation A/c Dr.
To Branch Assets A/c To Head Office A/c